IT Maturity, Inc. Newsletter #15

What is the Meaning of Innovation?

"Innovation" is a subcategory of the larger category of "improvement". In a business environment there
are gradations of both 1) ‘how much improvement occurs’ and 2) ‘what can be improved’. Both of
these gradations need to be understood in order to understand innovation in a business environment.

It is important not to confound these two spectrums. For example, one classification of innovation
includes: efficiency, sustaining, and disruptive innovations. However, some of these fit within the
gradation of ‘how much improvement occurs’ while others are gradations of ‘what can be improved’.
Both ‘efficiency innovations’ and ‘sustaining innovations’ are gradations of 'what can be improved',
while ‘disruptive innovations’ fits more in the gradation of 'how much improvement occurs' (see the third bullet above)

The breadth of 'how much improvement occurs' at a gross level includes:

Minor improvements that provide minimal return for an enterprise, insufficient to merit note at the executive level.

Major improvements that provide sufficient return to be of note at the executive and board level.

Major improvements which can be called big “I”ť innovations, because they have not been done elsewhere in industry.

There is no reason to use this type of ‘how much improvement’ gradation to be snobby with the term
"innovation". Minor innovations and innovative implementations of existing industry solutions in new
business environments are sufficiently meritorious to use the term innovation with a little "i". The
question is more of where you are using the term innovation. Corporate prospectus would likely be
appropriately restricted to a big "I" innovation usage of only unique improvements of executive level merit.

The breadth of ‘what can be improved’ includes:

Business Enhancement

Technology and Service Advancement

Partner and Vendor Integration

Leadership Improvement

In all of these categories improvements in quality, cost, speed and feature are all of merit.

With Business Enhancement, businesses look into their processes, sub processes, and cross processes
for improvements.

With Technology and Service Advancement, enterprises look to improve the products and services
they provide to the marketplace, as well as technological innovations within their operating infrastructure and manufacturing environments.

With Partner and Vendor Integration corporations look to enhance their relationships and interactions
in mergers, acquisitions, supply chains, and distribution chains.

A recent survey of global executives found that 43% had a chief innovation officer with most them not
having a clear strategy. There are actually two issues embedded within this concern of not have a clear
innovation strategy. The first issue is one of how can improvements be fostered across the entire
breadth of organizations. The second issue is which of these improvements should be elevated to the
level of the executive team or a chief innovation/improvement officer. Processes are now coming on line to address both of these issues methodically.

For example the IT Maturity Method (ITMM) from IT Maturity provides training on how to methodically
use IT to mature organizations in Business Advancement, Technology and Service Advancement,
Vendor Integration, and Leadership Improvement. This includes techniques on how to drive
organizations to work on improvements across the full spectrum of the enterprise. Leadership
Improvement includes techniques to define, track and measure, and tune and advance organizational
structures, including those structures related to improvement and innovation.

As an example of how to drive service innovation, let’s look as the service model for a newspaper. On
the surface one might conclude that the purpose of newspapers in to provide 'new' information to
users. However, businesses in general provide only two elements to their customer base, product and
service. One might think that 'information' is the product, but this would miss the point. The question
is in how the product or service is used by customers. From a product perspective the paper from the
newspaper might be used to line a bird cage, but that misses the primary point of newspapers.
Newspapers are really used as a service, for the information provided by a newspaper is used by
customers for either their own entertainment or to solve the problems that they encounter, or both. In
this perspective, the newspaper is primarily providing services, not a product that can be used as an implement to do something.

How is the newspaper’s service evolving? Information, the service, is being provided online as well as
in print. From a medium perspective the service is becoming more interactive. Individuals are able to
blog in response to news articles. Some magazines have regularly scheduled conferences and webinars
to provide more than one way communication. How can the service further evolve? From a medium
perspective, blogging can be extended to ad hoc webinars, which include video and sharing of media.
This extension could be attached to both content and advertisements.

From a service improvement of information usage perspective, the questions should be asked on how
to enhance articles with links, contacts, products, services, and other tools for customers to follow to
further address the problems they are trying to solve with the information from the newspaper.

How can newspapers drive these service improvements into your organization? Most of them require IT
enhancements. Some also require process changes on what information should be included in articles.

More importantly how can the search for improvements to service be driven into organizations? How
can newspapers get their entire organization to methodically and continually look for how to better
entertain and provide better information solution paths for customers? Part of the solution is to insure
that the IT organization is ahead of the curve with regard to IT innovations, with respect to your
organizational processes, products, and services. The other part of the solution is in the usage of IT
to put tools in front of the larger business team so that the larger business team methodically and
continually reviews advancements within their individual roles and sub processes. The ITMM provides tools to do this.